2 Economists Question Benefit of Cleaning Up A Major Air Pollutant

Published: April 30, 1991

THE health benefits of cleaning up a widespread urban air pollutant, ground-level ozone, may not be worth the price, two economists argue in a new study.

The economists at Resources for the Future, a respected nonadvocacy research institute in Washington, compared the costs of plans for Los Angeles and the nation as a whole to meet national air quality standards for ground-level ozone with their potential health benefits. In both cases, the most optimistic estimate of the costs fell far short of the most optimistic measure of the health benefits.

They chose to look at ground-level ozone because it is one of the most difficult air pollution problems to solve. They also said they believed they could effectively apply cost-benefit analysis to it.

According to cost estimates based on 1989 Government data, they found the cost for the nation to meet the standards would be $8.8 billion to $12.8 billion through 2004 while health benefits would be $250 million to $1 billion. They estimated that the cost of a more ambitious 1989 Los Angeles plan would be $13 billion through 2010 but that it would yield only $3 billion in health benefits. Basis of Conclusions

The economists, Alan J. Krupnick and Paul R. Portney, concluded that air should be cleaned up in the most polluted areas but that investing billions of dollars to get people to quit smoking, control radon gas and provide better prenatal and neonatal care might contribute much more to public health.

The researchers, whose findings appear in the current issue of the journal Science, emphasized that their study was not an analysis of the recently passed amendments to the Clean Air Act.

Mr. Krupnick and Mr. Portney used laboratory and epidemiological studies linking improvements in air quality to improvements in human health. They then combined that data with a number of studies that have sought to determine how much people would be willing to pay to avoid loss of income and medical costs associated with illness or some symptoms. For example, they used a value of $25 for each asthma attack prevented.

They did not include crop damage or reductions in chronic illness, they said, because those changes had not been linked convincingly to reductions in ground-level ozone. However, many scientists believe there is a definite link between ground-level ozone and crop damage and chronic illness.

The economists readily acknowledged in interviews that their analysis was based on educated guesses and data from the past. They said new pollution control technologies and studies linking other health benefits to reductions in ground-level ozone might make the costs and benefits more equal. But they said they did not believe their conclusions would change if new technologies or benefits were discovered.

"I don't expect people to like the conclusions," Mr. Portney said. "But this is not a justification for not cleaning up the air. It just says maybe we could get more health benefits for our money if we spent it someplace else."

Environmentalists familiar with the study strongly disapproved of its cost-benefit analysis technique and its conclusions, though they agreed that the most cost-effective means must be used to control pollution.

"This study's Achilles' heel is that it cannot capture the nonmonetizable aspects of cleaner air," said Dr. Michael Oppenheimer, senior scientist at the Environmental Defense Fund.

He said it was impossible to get people to put a dollar figure on how much they wanted or benefited from cleaner air. He added that the study did not consider esthetic benefits of cleaner air nor did it include possible damage from chronic exposure to high levels of ground-level ozone.

Industry representatives were more sympathetic. "They are daring to ask the questions that need to be asked," said William D. Fay, former administrator of the Clean Air Working Group, a coalition of 2,000 businesses that worked on the recent changes to the Clean Air Act. "I'm not sure the public knows the trade-offs of focusing on clean air."

In the face of such uncertainties over costs and benefits, the recent amendments to the Clean Air Act were written to provide flexibility, said Rob D. Brenner, the director of the Air Policy Office at the Environmental Protection Agency. He said the areas with the most severe air pollution problems had to reduce emissions of complex hydrocarbons by 3 percent a year. In this way, he said, the least costly things can be done first, and Congress can decide later if laws need to be changed.